Oil Markets Creep Higher On Supply Pact Expectations

Crude oil markets were slightly higher on Friday, supported by continuing supply cuts and expectations that an output deal will be extended at the end of the month.

Brent crude was at $64.22 a barrel at 1017 GMT, up 27 cents from the previous close and 43 cents off a more than two-year high of $64.65 reached this week.

U.S. West Texas Intermediate (WTI) crude was at $57.26, up 9 cents and also not far from this week’s peak of $57.92, its highest in more than two years.

The higher prices are a result of efforts led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia to tighten the market by cutting output, as well as strong demand and rising political tensions.

There are also expectations in the market that OPEC’s next meeting on Nov. 30 will agree to extend cuts beyong the current expiry date in March 2018.

“Clearly the market is still convinced that OPEC will succeed in tightening the market to a sufficient extent by extending its production cuts. Attention is therefore paid to any news that supports this view,” Commerzbank analysts said.

“Even significantly weaker Chinese crude oil imports in October and an increase in U.S. crude production to a record level failed to exert any lasting pressure on oil prices.” Read More…